Earlier the duties of the State were mostly maintaining law and order. With
increasing influence of the State in our everyday lives the normal view of
liability of the State canï¿½t be accepted. The courts previously in crucial the
liability of the State for wrongs committed by it have examined broadly the
principle of sovereignty.
The present case is related to the Governmentï¿½s liability towards its sovereign
acts and the tortuous act of its servant. In this case the question before the
Supreme Court came that whether the confiscation of property by the Government
comes under the sovereign act and will there no liability of the Government
arise for the same.
The plaintiff-appellant of this case was N. Nagendra Rao and co. He had a
business, he used to deal in fertilizers and food grains and he also had the
license for the same. The authorities on 11th August, 1975 raided the premises
where the plaintiff carried out his business. The police officer and the
vigilance cell confiscated various things, which included huge stocks of food
grains and fertilizers and also the non-essential items.
The police officer
submitted the report on 31st August, 1975. The District Revenue officer
subsequently in his powerï¿½s exercise under section 6(a) of the Essentials
Commodities Act directed to handover the custody of the fertilizer to the
Assistant Agricultural Officer, so that it could be distributed to the farmers
and the food grains and non-essential items to the Tehsildar. Tehsildar was
supposed to dispose the goods immediately and was asked to deposit the earnings
for the same to the Government Treasury. But neither the Tehsildar comply with
the order nor the Assistant Agricultural Officer.
this submitted applications on 17th and 21st September before the District
Revenue Officer claiming the deterioration of the fertilizers since no relevant
steps were being taken. He requested to divert the fertilizers to him as no
steps were being taken by the Government, so he will sell the goods and transfer
the amount to the Government Treasury but the Government did not take any
actions to his application.
When on 29th June 1976 the District Revenue Officer in the exercise of his power
under section 6(a) of the Essential Commodities Act seized the goods of the
plaintiff-appellant his license was cancelled as well. The District Revenue
Officer Stated that though the plaintiff-appellantï¿½s fertilizer account is
irregular i.e., he isn't always a defaulter of black-marketing, adulteration, or
promoting the products for higher price than the usual price, so a few a part of
the fertilizer be seized and the last can be again given back to
The plaintiff-plaintiff-appellant against the above order appealed in the
District & Session Court in which the court asked the goods to be returned to
the plaintiff-appellant When the plaintiff-plaintiff-appellant lodged a
complaint to the Chief Minister, Revenue Minister, Agriculture Minister and the
other authorities then on March, 1977 the Assistant Agricultural Officer sent a
notice with intention to return the confiscated goods.
After finally receiving
the goods, the plaintiff observed that the goods were of less quantity and bad
Then finally the plaintiff filed a suit before the District and Session Court
claiming to get back the amount equivalent to the confiscated the goods. The
court held that after the confiscation of the goods by the District Revenue
Officer, the relationship of Bailer and Bailee between the Plaintiff and the
Government was established.
The Government in this situation had a duty to look
after the bailed goods and safeguard them from loss but the Government in this
situation hadnï¿½t performed its duty. It was also held that the seizing of the
goods by the Government doesnï¿½t fall under the purview of its sovereign act,
hence the Government was held liable and was asked by the court to compensate
The Government after this order filed an appeal before the High Court.
Court set aside the judgement of the District Court and held that the power that
the Revenue Officer exercised falls under the statutory powers of the Government
and hence it is not liable for damages.
Then the plaintiff against the above order filed a suit before the Supreme
Court, he Stated that the act of seizing of the goods was not the sovereign
power of the Government. The goods were in bad condition and it was the
Governments duty to look after it.
- Whether the goods seized in the exercise of the sovereign power gives
the Government immunity from loss or damage suffered to the owner.
- Whether the seizure of a part of the goods immunizes the State from any
claim of loss or injury suffered by the owner that were directed to be
The following arguments were made by both the parties before the Supreme Court:
- The plaintiff said that the confiscation of his goods by the Government
doesnï¿½t comes under the purview of sovereign act of the Government.
- The goods were deteriorating and it was Governmentï¿½s duty to take care
of it but they were negligent towards their part.
- The Government was liable for the damages suffered by him, thus he is
entitled to receive damages for the loss from the Government.
- The Government argued that their act of seizing of goods comes under the
purview of sovereign act of the Government.
- Hence, their no liability on the part of the Government arises.
At the first, when the plaintiff appealed in the trial court, it was found that
the moment State took over the goods from the plaintiff, there a relationship of
bailor and bailee was established. Going back to the basics we know the
essentials of the contract of bailment and here all the essentials of it were
fulfilled. There as a bailee it was the duty of the state to look after the
N. Nagendra v. State of AP
should be examined within the ambit of the
In the case of State of Rajasthan v. Vidhyawati
, A pedestrian was
knocked down by a Jeep of the Government, the pedestrian died in the accident.
The State of Rajasthan appealed to the court that it was doing its sovereign act
and should be granted immunity.
The Court held that the State would be liable
for the tortious acts committed by its servant. The distinction of sovereign and
non-sovereign acts was not considered. Court stated that the State would not be
held liable for its act within the ambit of Article 300 of the Constitution.
court awarded the petitioner a sum of Rs 15000. Court added that in these modern
times the State has to act for the welfare of the people and defence of
sovereign immunity on the basis of old notions of justice canï¿½t be granted. In
Nagendra Raoï¿½s case also the State under the Essential Commodities Act seized
the goods for public welfare, as the goods were deteriorating so it was the
Stateï¿½s duty to safeguard it. Hence the State was held liable for the losses
suffered by the owner.
In the case of Kasturi Lal Ralia Ram Jain v. State of UP
, the Police had
suspected that the Plaintiff had stolen gold so the Police seized the gold from
him. It was then misappropriated by one of the Police officer who ran away with
the gold to Pakistan. Court held that that as the act of the State falls under
the sovereign act so it canï¿½t be held liable.
If the State interferes with the life and liberty of the individual or gets
involved in commercial or public activity then in that case the Sovereign
immunity canï¿½t be used a protection. If the State get involved in such activity,
then it must be legally bound to compensate. The State may get protection if it
is acting in the public interest.
First the trial court held that the State was negligent in the course of
performing its duty. The court asked the state to pay damages of Rs 1,06,125 for
the stocks that were damaged and the trial court also asked the State to pay the
amount with interest of 6%.
Then later on the above order was struck down by the Court and the court drew
nexus on the basis of Kasturi Lal Ralia Ram Jain Case.
The Supreme Court upheld the views Stated in the case of Kasturi Lal and
distinguished Vidhyawati case
. The court held that in the barring functions of
State that are primary and inalienable such as administration of justice,
maintenance of law and order and repression of crime etc., the immunity canï¿½t be
provided to the State. Referring to the principle of the Vicarious Liability it
was held that if in the discharge of public property an officer of the State can
be sued personally then for his negligence even, they can be sued. As this
particular doctrine of Vicarious Liability is outdated and the power lies with
the people so that immunity canï¿½t be claimed by the State. Hence the Court asked
the State of Andhra Pradesh to pay the damages.
The Supreme Court laid down the following principles in this case:
- Act of seizing the goods doesnï¿½t comes under the power of sovereign act.
- The Government will be held liable for the tortious acts of its servant.
- The servantï¿½s tortious acts cannot be sovereign act.
- The doctrine of Sovereignty should be clearly enacted.
I agree with the judgement given by the Supreme Court. The State had seized the
goods of the plaintiff-appellant. The seizing of goods for the interest of the
public comes under the functions of welfare State and not the primary functions.
But here the court applied the principle of Vicarious Liability.
The District Revenue officer and The Assistant Agricultural Officer were at
fault. They had committed the tortious acts. So, drawing the nexus with the
Vidhyawati case and the Kasturi Lal case the court held that for the acts of the
tortious acts the servant had committed, the master would be held liable. Though
there was the interest of public involved, the State didnï¿½t get immunity due the
wrongs committed by their servants and also the state was negligent on their
The Supreme Court in this case drew nexus with the Kasturi Lal case
and it was necessary to compare the two cases with the
current as in both those cases there was wrong committed by the State and in
both the cases State tried to use the defence of immunity given to them while
performing sovereign acts so it was important here to refer to the decisions
given in those cases.
- Kasturi Lal Ralia Ram Jain V. State Of U. P. [AIR 1965 SC 1039]
- State Of Rajasthan V. Vidyawati (AIR 1962 SC 933)]
- Kasturi Lal Ralia Ram Jain v. State of U. P. [AIR 1965 SC 1039]
- State of Rajasthan v. Vidyawati (AIR 1962 SC 933)
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